HELSINKI, April 13 (Xinhua) -- Finland's economy is expected to grow by 1.0 percent, down from 1.5 percent from the previous forecast, as the tensions in the Middle East and its fallout are slowing the pace of recovery, OP Pohjola, Finland's largest financial group, said in a press release on Monday.
Finland's economy began to recover at the end of last year, and the rebound continued in January and February. However, the crisis in the Middle East is weighing on the recovery, the press release said.
The forecast is based on the assumption that oil prices will begin to ease and fall to 70 U.S. dollars per barrel by the summer.
"The war in the Middle East and its consequences will inevitably weaken Finland's economic development. Finland's economy will weather the short-term spike in oil prices and heightened uncertainty, but it will still take a hit," said Reijo Heiskanen, chief economist at OP Pohjola.
Heiskanen warned that a prolonged and escalating crisis in the Middle East could push Finland back into recession, especially amid rising uncertainty.
Since the United States and Israel launched attacks on Iran at the end of February, disruption to shipping through the Strait of Hormuz has pushed up global oil prices, adding to pressure on energy markets and raising concerns over fuel and electricity costs in import-dependent economies. ■